U.S. Dollar Tries To Gain More Ground As Traders Focus On Middle East: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Is Little Changed As Existing Home Sales Miss Analyst Estimates

U.S. Dollar Index is mostly flat as traders focus on the Existing Home Sales report. The report indicated that Existing Home Sales decreased by -1.7% month-over-month in July, compared to analyst forecast of -0.7%.

U.S. Dollar Index continues its attempts to settle above the resistance level at 99.85 – 100.00. In case U.S. Dollar Index manages to settle above the 100.00 level, it will move towards the next resistance, which is located in the 100.50 – 100.65 range.

EUR/USD Pulled Back Below The 1.1550 Level

EUR/USD is swinging between gains and losses as traders wait for geopolitical news from the Middle East. Defense Minister of Pakistan has recently said that U.S. and Iran were close to some kind of a deal despoite aggressive rhetoric from both sides. In case U.S. and Iran reach a temporary deal, oil prices will dive, providing support to the European currency.

If EUR/USD climbs back above the 1.1550 level, it will head towards the resistance level at 1.1600 – 1.1615. On the support side, a successful test of the support at 1.1510 – 1.1525 will push EUR/USD towards the next support level at 1.1435 – 1.1450.

GBP/USD Moved Away From Weekly Highs

GBP/USD is little changed as traders focus on the BRC Retail Sales Monitor report from the UK. The report showed that Retail Sales increased by +1% year-over-year in July, compared to analyst forecast of +1.5%.

The nearest support level for GBP/USD is located in the 1.3465 – 1.3480 range. If GBP/USD manages to settle below the 1.3465 level, it will head towards the next support at 1.3335 – 1.3350. On the upside, a move above the 1.3520 level will push GBP/USD towards the resistance level at 1.3550 – 1.3565.

USD/CAD Tests New Lows

USD/CAD is losing ground as traders focus on falling Treasury yields. The yield of 2-year Treasuries declined towards the 4.22% level, while the yield of 10-year Treasuries settled below 4.70%. Other commodity-related currencies are also moving higher despite the pullback in precious metals markets.

Currently, USD/CAD attempts to settle below the support level at 1.3920 – 1.3935. If USD/CAD manages to settle below the 1.3920 level, it will move towards the next support, which is located in the 1.3825 – 1.3840 range.

USD/JPY Is Mostly Flat As Traders Take Some Profits After The Strong Rebound

USD/JPY is stuck below the resistance level at 159.50 – 160.00 as traders ignore the pullback in Treasury yields. Falling Treasury yields did not put pressure on USD/JPY as traders believe that BoJ will be forced to maintain its ultra-dovish policy. The major difference in yields between U.S. and Japan serves as the key bearish catalyst for the Japanese currency.

In case USD/JPY climbs above the 160.00 level, it will head towards the next resistance level at 161.50 – 162.00. RSI is in the moderate territory, so there is plenty of room to gain upside momentum in case the right catalysts emerge. It remains to be seen whether BoJ is ready to intervene in case USD/JPY tests the 162.00 level.

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